2012-06-04 afr.com - Banks get ready for virtual cash

[julz]

Australian Financial Review

Banks get ready for virtual cash

DAVID RAMLI AND RUTH LIEW
2012-06-04

http://afr.com/p/technology/banks_get_ready_for_virtual_cash_I7LI6KZ7wx9TXNwUKWuc9I

...
Where traditional currencies such as the Australian dollar are guaranteed by governments, virtual currencies such as BitCoin often have no central organising groups or value.

But despite the risks, usage is rising.
...

Yes it's a duplicate posting, but I don't consider posting a redirecting spamvertising URL to be a proper article report. Mods can decide which thread to delete.

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[Stephen Gornick]

He said regulators such as the RBA and the US Federal Reserve had to think of new ways to tax and manage virtual currencies as it became a valuable global commodity.

The Federal Reserve is responsible for ensuring that a competing monetary system can be taxed?

[rjk]

He said regulators such as the RBA and the US Federal Reserve had to think of new ways to tax and manage virtual currencies as it became a valuable global commodity.

The Federal Reserve is responsible for ensuring that a competing monetary system can be taxed?

Yeah I had to giggle at that a little bit.

[Stephen Gornick]

City Index FX strategist Kara Ordway said virtual money could easily be a tradeable commodity not unlike the Australian or US dollar, once market demand and supply was established.

It's not already being traded or theres no supply or demand already?

Not at levels where liquidity is sufficient.  A few hours ago there was a ~100K USD buy (~20K BTC) and the price rose 2%.  Imagine what a $1 million USD buy would do.

[ArticMine]

“We have a planning assumption that virtual currencies will become mainstream in three to five years,” Mr Davis said. “One of the reasons why we need to reach a view two to four years out is to influence our decisions around enterprise architecture, because it doesn’t change very often.

This is the crux of the article. A bank needs to start planning now to be able to trade Bitcoin and provide Bitcoin services to its customers in 3 - 5 years when Bitcoin becomes mainstream.

[proudhon]

Though the article does mention bitcoin, I wonder if bitcoin is really among the virtual currencies these banking folks have in mind in their planning.  I haven't seen any evidence to suggest it is, and I still think bitcoin is too small for them to really care about.  The "bitcoin" mention looks more like the author tossing out what he thinks is an example.

[julz]

Though the article does mention bitcoin, I wonder if bitcoin is really among the virtual currencies these banking folks have in mind in their planning.  I haven't seen any evidence to suggest it is, and I still think bitcoin is too small for them to really care about.  The "bitcoin" mention looks more like the author tossing out what he thinks is an example.

I wonder too. Investors and banks are looking where the masses of eyeballs are. They'll be gearing up to deal with the 'virtual currencies' of things like facebook, WoW etc - but I think something P2P and not driven/owned by a single corporation is still going to be a bit of a surprise for them in that it requires a heck of a lot more understanding than just striking a deal with a few major stakeholders and linking up a database or two.  They may have heard of Bitcoin - but I'm not convinced they understand the difference... or perhaps they do, and it's not just too small, but all too hard in comparison.